LATEST GST CASE LAWS: 05.06.2025
🔥📛 HC: Relegates taxpayer allegedly having connection with queen pin of ITC fraud to appeal-remedy
➡️ The Delhi High Court refused to entertain a writ petition filed by the assessee challenging show cause notices over alleged fake Input Tax Credit (ITC) claims worth ₹172 crores, involving non-existent firms and invoices without actual supply of goods.
➡️ The Court noted that the assessee had not replied to the show cause notices and had instead directly approached the Court, despite being aware of the ongoing proceedings before the Adjudicating Authority.
➡️ The GST Department argued that 34 notices were issued, including to a key individual (Mrs. Aaurti Kapoor) alleged to have passed on the fake ITC through bogus invoices, and that the GSTR-1 filings indicated no actual movement of goods.
➡️ The Court observed that the alleged connection between the assessee and Mrs. Kapoor is a matter of fact that should be decided by the appropriate adjudicatory forum.
➡️ The High Court directed the assessee to file an appeal by July 15 with the required pre-deposit, assuring that the appeal would be heard on its merits and not rejected as time-barred, and accordingly disposed of the writ petition.
✔️ Delhi HC – Standard Cartons Pvt. Ltd. vs. Office of the Commissioner Central Tax [W.P.(C) 7186/2025]
🔥📛 Assessee can file consolidated appeal if SCN issued for multiple FYs but only one FY mentioned in order: HC
➡️ A Show Cause Notice (SCN) was issued to the assessee alleging wrongful availment of Input Tax Credit based on invoices without actual movement of goods, covering the financial years 2017-18 to 2019-20.
➡️ The assessee submitted a reply to the SCN, after which a single adjudication order (impugned order) was passed creating a demand against them.
➡️ The assessee raised a concern that since the SCN involved multiple years, they would have to file separate appeals for each financial year.
➡️ However, it was noted that the SCN and the impugned order were both common and related to all three financial years, though the order specifically mentioned only 2017-18.
➡️ The authority held that the assessee may file a single consolidated appeal under Section 107 of the GST Act, as the matter originated from one SCN and resulted in a common adjudication order.
✔️ Delhi HC – Metalax Industries v. Additional Commissioner [W.P.(C) No. 6397 OF 2025]
🔥📛 SLP dismissed since revenue cannot use coercive measures until petition is resolved
➡️ The case involved multiple show cause notices issued to the assessee for overlapping tax periods, concerning demands and recovery of tax or input tax credit not involving fraud, misstatement, or suppression.
➡️ While these notices were under challenge, assessment orders were passed by the authorities, leading the assessee to seek legal relief.
➡️ The High Court ruled in favor of the assessee, restraining tax authorities from taking coercive action until the pending legal challenges were resolved.
➡️ The revenue department filed a Special Leave Petition (SLP) before the Supreme Court, challenging the High Court’s decision.
➡️ The Supreme Court found no valid reason to interfere under Article 136 of the Constitution and dismissed the SLP, upholding the High Court’s protection to the assessee.
✔️ SC – Commissioner of Central Tax and GST Delhi North v. Raghav Agarwal [SPECIAL LEAVE PETITION (CIVIL) Diary No(s). 21913 of 2025]
🔥📛 GST demand can not be raised through consolidated order for multiple years; separate orders required: HC
➡️ The case involved a consolidated demand notice and adjudication order covering multiple financial years (2017-18 to 2020-21) related to tax or Input Tax Credit (ITC) fraud under GST.
➡️ The assessee challenged the orders, arguing that a single notice for all years was improper and that no personal hearing notice was provided.
➡️ The revenue countered by stating that summons were issued, representatives’ statements were recorded, and a hearing notice was emailed to the assessee.
➡️ The court noted that the assessee had not responded to the show cause notices (SCNs) issued by the department.
➡️ The department was directed to upload a revised DRC-07 form with year-wise tax amounts, and the assessee was allowed to pursue appellate remedies against the orders.
✔️ Delhi HC – India News Media (P.) Ltd. v. Assistant Commissioner Okhla Division CGST Delhi [W.P.(C) No. 6993 and 6994 of 2025]
🔥📛 Order rejecting rectification application to be set aside as it was passed without granting personal hearing: HC
➡️ The assessee’s application for rectification under Section 161 of the CGST/Delhi GST Act was rejected without giving them a chance to be heard.
➡️ The court held that when a rectification decision may adversely affect the assessee, a personal hearing must be granted, as per the third proviso to Section 161.
➡️ Denying a hearing violates the principles of natural justice, which require fair opportunity before making adverse decisions.
➡️ Since no hearing was given in this case, the order rejecting the rectification application was set aside.
➡️ The authority must now provide a hearing to the assessee and then decide the rectification application as per the law.
✔️ Delhi HC – Transzone Logistics India (P.) Ltd. v. Sales Tax Officer, AVATO [W.P. (C) No. 6583 of 2025]
🔥📛 Provisional release can not be denied based on non-adjudicatory DGGI letter; SCN required: HC
➡️ The assessee’s consignment of areca nuts was seized by the GST authorities due to improper documentation during transport.
➡️ The assessee voluntarily wrote to the DGGI expressing willingness to deposit the applicable tax and penalty in return for provisional release of the goods.
➡️ In response, the department issued a communication instructing the assessee to deposit the tax and penalty and submit Form DRC-03 for release.
➡️ The assessee later contested this, arguing that tax and penalty could not be demanded without a proper show cause notice.
➡️ The court held that the communication was not an adjudication order but merely a reply to the assessee’s own request, and directed the GST department to issue a show cause notice for further proceedings.
✔️ Delhi HC – Shashi Kumar Choudhary v. Deputy Director Directorate General of GST Intelligence [W.P. (C) No. 6723 of 2025]
🔥📛 Writ not maintainable in ITC fraud case; petitioner must pursue appellate remedy: HC
➡️ The petitioner challenged an order passed by the Additional Commissioner regarding denial of Input Tax Credit (ITC), claiming that they did not receive the show cause notice and thus couldn’t respond.
➡️ The impugned order was part of a broader action involving 428 parties, all accused of fraudulently availing ITC.
➡️ Courts had previously ruled that in cases involving fraud allegations, writ petitions are not the appropriate remedy.
➡️ The court held that the petitioner should instead use the appellate remedy available under Section 107 of the GST Act.
➡️ The petitioner was allowed to file an appeal with the required pre-deposit, and if done within the prescribed time, the appeal would be considered on its merits without being rejected for delay.
✔️ Delhi HC – Superb Industries v. Additional Commissioner CGST [W.P. (C) No. 6789 OF 2025]
